Anne Zieger is veteran healthcare consultant and analyst with 20 years of industry experience. Zieger formerly served as editor-in-chief of FierceHealthcare.com and her commentaries have appeared in dozens of international business publications, including Forbes, Business Week and Information Week. She has also contributed content to hundreds of healthcare and health IT organizations, including several Fortune 500 companies. Contact her at @ziegerhealth on Twitter or visit her site at Zieger Healthcare.

While you might not own any them, you’ve probably heard of bitcoins, a floating currency backed by no government entity. You may also be aware that these coins are backed by blockchain technology, a decentralized system in which all participants track everyone’s holdings on their own individual systems. In this world, buyers and sellers can exchange bitcoins untraceably, making bitcoins perfect for criminal use.

In fact, some readers may have first heard about bitcoins when a Hollywood, CA hospital recently had all its data assets frozen by malware hackers, who demanded a ransom of $3.4 million in bitcoins before the hospital could have its data back. (The hospital ended up talking the ransomware attackers down to paying $17K, and when it paid that sum, IT leaders got back control.)

What’s intriguing, however, is that blockchain technology may also be a solution for some of healthcare’s most vexing health data security problems. That, at least, is the view of Peter Nichol, a veteran healthcare business and technology executive consultant. As he sees it, “blockchain addresses the legitimate previous concerns of security, scalability and privacy of electronic medical records.”

In his essay posted on LinkedIn Nichol describes a way in which the blockchain can be used in healthcare data management:

Patient: The patient is provided a code (private key or hash) and an address that provides the codes to unlock their patient data. While the patient data is not stored in the blockchain, the blockchain provides the authentication or required hashes (multi-signatures, also referred to as multi-sigs) to be used to enable access to the data (identification and authentication).

Provider: Contributors to patient’s medical records (e.g. providers) are provided a separate universal signature (codes or hashes or multi-sigs). These hashes when combined with the patient’s hash establishes the required authentication to unlock the patient’s data.

Profile: Then the patient defines in their profile, the access rules required to unlock their medical record.

Access: If the patient defines 2-of-2 codes, then two separate computer machines (the hashes) would have to be compromised to gain unauthorized access to the data. (In this case, establishing unauthorized privileged access becomes very difficult when the machines types differ, operating systems differ and are hosted with different providers.)

As Nichol rightly notes, blockchain strategies offer some big advantages over existing security, particularly given that keys are distributed and that multiple computers but need to be compromised for attackers to gain access to illicit data.

Nichols’ essay also notes that blockchain technology can be used to provide patients with more sophisticated levels of privacy control over their personal health information. As he points out, the patient can use their own blockchain signature, combined with, say, that of a hospital to provide more secure access when seeking treatment. Meanwhile, when they want to limit access to the data it’s easy to do so.

And voila, health data maintenance problems are solved, he suggests. “This model lifts the costly burden of maintaining a patient’s medical histories away from the hospitals,” he argues. “Eventually cost savings will make it full cycle back to the patient receiving care.”

Ultimately, whether Nichols is entirely on target or not, it seems clear that health IT players have much to gain by exploring use of blockchain technology in some form. In fact, I predict that 2016 will be a breakout year for this type of application.